Ford Pinto Fires Case Study and Executive Summary
Ford Pinto Fires Case Study and Executive Summary
John Bonner, Scotti Greenleaf, Rose Scarbrough
MGT216
University of Phoenix
October 18, 2010
Sarah Nelson
Ford Pinto Fires Case Study and Executive Summary
Introduction
During the Late 1960’s the Ford Motor Company was one of the leading auto manufactures in the United States. Ford was credited with revolutionizing the muscle car era of the 1950’s and 1960’s. During the mid 1960’s Lee Iacocca helped Ford establish itself in the late 1960’s with the introduction of the Ford Mustang. During this time foreign auto manufactures were gaining market share in the mid to compact car markets. This was largely due to customers seeking more fuel efficient cars because of soaring fuel prices. Ford saw an opportunity to regain a portion of this market with the introduction of the Ford Pinto. This would bring them into direct competition with the foreign manufactures. The idea was to produce a small car that was affordable for the customer, and had a relatively high profit margin. With the introduction of the Ford Pinto, Ford’s desire to compete with the foreign manufacturers led Ford to overlook known design flaws and their own ethics while in search of higher profits.
The People In May of 1968 then vice president of Ford Motor Company Lee Iacocca recommended the introduction of a subcompact car into the market. The Ford Pinto’s design and development period was the shortest in automotive history (Trevino, p. 115). Iacocca wanted the Ford Pinto in showrooms by 1971, the development and design process was accelerated from 43 months to 38 months. Ford assigned a team of engineers to work on nothing but the Pinto. This team was required to stick to Mr. Iacocca’s goal of “the limits 2000”; this meant that the car could not weigh more than 2000 pounds. This became a challenge for the engineers, and created concerns regarding the placement of the fuel tank (FordPinto). Due to the accelerated production
John Bonner, Scotti Greenleaf, Rose Scarbrough
MGT216
University of Phoenix
October 18, 2010
Sarah Nelson
Ford Pinto Fires Case Study and Executive Summary
Introduction
During the Late 1960’s the Ford Motor Company was one of the leading auto manufactures in the United States. Ford was credited with revolutionizing the muscle car era of the 1950’s and 1960’s. During the mid 1960’s Lee Iacocca helped Ford establish itself in the late 1960’s with the introduction of the Ford Mustang. During this time foreign auto manufactures were gaining market share in the mid to compact car markets. This was largely due to customers seeking more fuel efficient cars because of soaring fuel prices. Ford saw an opportunity to regain a portion of this market with the introduction of the Ford Pinto. This would bring them into direct competition with the foreign manufactures. The idea was to produce a small car that was affordable for the customer, and had a relatively high profit margin. With the introduction of the Ford Pinto, Ford’s desire to compete with the foreign manufacturers led Ford to overlook known design flaws and their own ethics while in search of higher profits.
The People In May of 1968 then vice president of Ford Motor Company Lee Iacocca recommended the introduction of a subcompact car into the market. The Ford Pinto’s design and development period was the shortest in automotive history (Trevino, p. 115). Iacocca wanted the Ford Pinto in showrooms by 1971, the development and design process was accelerated from 43 months to 38 months. Ford assigned a team of engineers to work on nothing but the Pinto. This team was required to stick to Mr. Iacocca’s goal of “the limits 2000”; this meant that the car could not weigh more than 2000 pounds. This became a challenge for the engineers, and created concerns regarding the placement of the fuel tank (FordPinto). Due to the accelerated production
References: Ford Motor Company. (2010). About Ford. Retrieved from http://www.ford.com/about ford/heritage/vehicles/modelt/672-model-t Gioia, D. (2006). Pinto Fires. In Managing business ethics: Straight talk about how to do it right (4th ed). Hoboken, NJ: John Wiley & Sons. Trevino, L.K. & Nelson, K.A. (2007), Managing business ethics: straight talk about how to do it right (4th ed.). Hoboken, NJ: John Wiley & Sons. The Ford Pinto Fuel Tank Safety (N/A). Retrieved October 12, 2010 from http://www.fordpinto.com/index